US records biggest budget surplus in seven years

A flood of tax payments pushed government receipts to an all-time high in April and left the country with the largest monthly budget surplus in seven years.

In its monthly budget report, the Treasury Department said Tuesday that the April surplus totalled US$156.7 billion, up from a surplus of US$106.9 billion a year earlier. It was the largest surplus since April 2008.

Government receipts totalled US$471.8 billion, the largest monthly total on record.

Receipts for the first seven months of the budget came to US$1.89 trillion, the biggest seven-month total ever. Tax receipts have climbed thanks to an improving economy, which has boosted individual and corporate tax payments.

Through the first seven months of the budget year that began in October, the deficit totalled US$282.8 billion, 7.7 per cent below last year.

The Congressional Budget Office is forecasting a full-year deficit of US$486 billion, roughly on par with the previous year.

From October through April, revenues totalled US$1.89 trillion, up 8.9 per cent from the same period last year. Individual payroll taxes and Social Security taxes are running six per cent higher than a year ago, while individual taxes on stock dividends, capital gains and payments by the self-employed are running 17 per cent above last year.

Government outlays over the past seven months totalled US$2.17 trillion, up 6.4 per cent from the same period a year ago.

The 2014 deficit was down from US$680.2 billion in 2013. Before 2013, the US had recorded four straight years of annuals deficits above US$1 trillion, reflecting the impact of a severe financial crisis and the worst recession since the Great Depression of the 1930s.

President Barack Obama in February unveiled a budget for 2016 - his final full year in office - that seeks authorisation from Congress to spend US$4 trillion next year. It projects a deficit of US$474 billion.

Obama's budget would boost spending on domestic programmes such as increased road construction, while raising taxes by US$2 trillion over the next decade by expanding levies on the wealthy, corporations and smokers.